I have just signed off my year 2 limited company accounts. That feels so good to say that one of those big annual jobs that I have managed to get done a whole three months early. My year end was 31st Aug 2017 and my accounts have to submitted to HMRC by the end of May and any tax due has to be paid by then as well.
Why I chose to set up a limited company?
I set up Mrs Mummypenny as a limited company from day 1 of full time focus and earning. I wanted to set it up as a separate legal entity and future proof it for growth in the future. The intention has always been to grow my business to high level of turnover, 6 figures is the aim, so setting up Mrs Mummypenny as a limited company was the right way to go. Tax wise there are benefits to have a limited company. Legally it is a separate entity to me so if anything happened to my business my personal assets are not affected.
I wanted to share with you the expenses I claim for and how I do my accounts. This is by no way advice, its just detail on what I claim as expenses which in turn reduces my profit and my tax bill.
My master spreadsheet
I have created a master spreadsheet containing all of my income and expenses and send this over to my accountant who checks it and turns it into my company accounts submission. I often include a query next to certain expenses and he will decide if its allowed or not.
Point to mention, I am a qualified accountant and spent 17 years in finance jobs. One of my very first jobs during my business placement at university (just the 20 years ago!) was for a chartered accountant doing peoples accounts and tax returns. So I do have some idea of what I am doing!
My Business Expenses
I pull salary out of my business using director fees and dividends. I tend to pull out what I need every month so it varies depending on what bills need to be paid and how much is sat in my business account! Recently my drawing have been bigger as I have been pulling out £1k chunks to pay off the credit card.
Telephone & Household Expenses
I claim for 50% of mobile phone and house broadband. I also claim for 25% of the gas & electricity.
Postage and Stationery
I put through all the receipts from the post office and any stationery I need for the business. I post out a lot of Blogging Your Way to Riches book’s so this cost adds up.
Publicity and Marketing
In here I claim for things like Facebook advertising, business awards, business cards, logo design, posters.
I put through all of my travel expenses to meetings/clients included trains, petrol, taxis. If I am writing about a day out with the children the costs are claimed for in here.
Here includes the hosting of my website. Monthly subscriptions for anything IT related. Payments to socialbee, appsumo, Microsoft. All any wage costs relating to the development of the website.
Any membership connected to the business of blog goes through here including federation of small business, CIMA, accountancy fees, VA costs.
I pay a monthly fee for my business banking as I am past the first free 18 months.
I hope that gives you a good introduction to what I claim for within my business expenses. And please remember this is JUST what I do and it not advice in any way.